Dalia
Ben-Galim is IPPR’s Associate Director for Family, Community and Work.
She joined IPPR after teaching social policy at Oxford University and
carrying out research at the LSE.

Despite the
speculation, the government’s mid-term review was surprisingly silent on
childcare. Rumours suggest that there is a Yellow-Blue battle raging in
government about the new childcare support package with details yet
to be agreed. Conservatives tend to favour tax relief and the talk is of
new childcare tax allowances of up to £2000.
But tax relief tends to be regressive,
with the winners likely to be middle class families with two or more children
with high childcare costs. With many poorer working families hurting from welfare changes,
Nick Clegg is apparently trying to skew any new support towards those on low
and middle incomes. Next week we will know if he has been successful.

Liz Truss,
the Childcare Minister, sidesteps that part of the debate in her ConservativeHome blog from yesterday on childcare reform. Truss’
claims are consistent and well known; public funding for childcare is
complex; child-to-adult ratios in England are stifling for childminders; and
regulation is burdensome. But her initial emphasis on recent Dutch reforms
seems to be wavering – perhaps influenced by IPPR’s
report pointing out their flaws – and has shifted towards the French
system. This is to be welcomed as there is much to learn from French provision,
but again it’s important to understand the limits of comparing childcare
systems, given the different contexts.

The French
have a long history of pro-natalist
family policy with relatively generous paid parental leave and home care
subsidies. This means that nearly two thirds of children aged under three are
cared for by their parents. Licensed family childcare assistants only look
after some 18 per cent of under-threes at home, and they typically care for one
to three children at a time, although they can now look after four children by
law. Only in crèches, which cater for 8 per cent of under-twos, is a higher 5:1
ratio permitted. In addition, 35 per cent of two-year-olds – usually children
from low-income families – are in nursery schools (écoles maternelles), a figure which rises to
90 per cent for three-year-olds, where ratios are much higher. So the
comparison with France does shed light on a different system from which the UK can
learn, but it is misleading to infer from it that looser ratios for
childminders have much if any impact on childcare costs, since the proportion
of under 5s for whom they cater is small.

Indeed, on
the much debated issue of ratios Truss seems to have shifted slightly.
Previously her focus was on childminder ratios, but today’s article expands to
adult-child ratios in all settings. Childminders are
broadly opposed to Truss’ deregulation agenda seeing it as a threat to the
status and quality of their profession. Many are worried that relaxing ratios
would potentially send the wrong message to parents and could be a deterrent to
prospective childminders who might want to enter the sector. So broadening out
of ratios to the whole sector poses additional questions on quality and the
extent to which inspection and regulation apply across all settings.

Workforce
qualifications also play a significant role. Like many Nordic countries, the qualifications
attained by the early years workforce in France are generally higher compared
to the UK. Using ratios as an indicator for costs is therefore limited given
the different levels and status of qualifications. The early years workforce
has a critical
impact on outcomes for children and the challenge of developing a
highly-trained and well paid workforce is a question that remains urgent and
cannot be left to market principles. Truss is right to focus on quality but it
is a real stretch to suggest that slightly looser ratios will lead to lower
prices and higher salaries (not least because in many European countries with
different ratios to the UK pay rates are set by national regulation or
collective bargaining).

IPPR’s
work on the Netherlands showed that demand subsidies don’t bring down
prices. The Australian
experience adds further evidence showing that demand led funding resulted
in a spiralling of costs for parents. In contrast, French nursery schools and
the Nordic system are largely supply funded, generating sustainable provision
of high quality. So instead of opting for regressive tax reliefs, the
government should continue to invest in free or heavily subsidised early years
provision, building on its extension of free nursery places for low income
two-year-olds. We need to complete the supply of a universal under 5s childcare
and early learning system, along Nordic lines. Supply funding gives stability
and affordability to parents. This is what will generate the higher rates of
maternal employment to which Truss rightly refers. Over the long term, boosting
maternal employment rates can generate
a net return to the Treasury.

Later this
week the coalition’s quad will thrash out their ideas on how best to support
parents but the debate on how to support children to develop and thrive should
also focus on quality. Universal early years provision must remain the goal.